Interesting Statistics on Cash Buyers and Foriegn Investment in US Real Estate

The National Association of Realtors (NAR)reports that foreign clients and investors spent $41 billion in the United States last year, and that does not include the additional $41 billion that “individuals with visas to stay for more than 6 months” spent in the same period of time. To put that into perspective, these figures represent approximately 8 percent of the entire U.S. housing market in the one year period from March 2010 to March 2011.

There is an interesting twist to these figures. Historically, foreign investment in US real estate was in the higher end of the markets - by a huge $100,000 over the US average home prices. However, in the above one year period, a majority of the acquisitions were under the $200,000 mark. This represents an average decline in sales price to foreign investment of over $100,000.

Domestic and foreign investors with cash are also becoming more active in the market.Twenty Eight percent of all real estate transactions in 2010 were cash transactions. Many analysts predict that this number will rise in 2011.

Finally, another interesting trend is that 22 percent of all sales activity in March of 2011 was investor acquisitions. The market - short sale lenders in particular - have been unfriendly toward investors. Yet, it is impossible to ignore the impact of investors in the real estate market.